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How compute cost of debt for WACC of a 5y project for company that has NO access to long-term debt markets?
Wiki User
∙ 10y ago
1. If company has no access to long term debt as a source of capital then weighted average cost of capital will only include the rate of equity as a WACC for discounting long term projects as firm has not a mix of debt and equity to finance its investment projects
Wiki User
∙ 10y ago
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Assume that abc is an airline company with zero debt to compute risky discount rate of abcs new investment project in the computer industry?
Assume that ABC is an Airline company with zero debt. To compute risky discount rate of ABC?s new investment project in the Computer industry, managers of ABC should use: A. ABC?s Equity Beta B. Unlevered Beta of Computer industry C. Unlevered Beta of Airline industry D. None of the above You can also get answer on onlinesolutionproviders com thanks
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